Dilip Kr. Roy, Kolkata V. DCIT, C ircle- 49, Kolkata, Kolkata

ITA 609/KOL/2010

• Counselvise Citation: 60923514 RSA 2010
• Duration Of Justice: 1 year(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-04-2011
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 25-03-2010
• Court: TRIBUNAL
• Department Lawyers: A K PRAMANIK
• Assessee Lawyers: A K DUTTA
• Keywords: Capital asset; Business income; Depreciation; Salary income; Cost of acquisition
• Section: 6; 56

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : KOLKATA () . . , , ! . .. .'# '#'# '#. .. . , ,, , $% , ,, , ) [BEFORE HONBLE SRI B. R. MITTAL, JM & HONBLE SRI C. D. RAO, AM] !& / I.T.A NO. 609/KOL/2010 '( )*/ ASSESSMENT YEAR : 2006-07 SHRI DILIP KUMAR ROY -VS.- DY. COMMISSIONER OF INCOME TAX KOLKATA [PAN : ADKPR 8050 Q] CIRCLE-49, KOLKATA. [ ,- /APPELLANT ] [ /0,-/ RESPONDENT ] AND !& / I.T.A NO. 629/KOL/2010 '( )*/ ASSESSMENT YEAR : 2006-07 ADDL. COMMISSIONER OF INCOME TAX -VS.- SHRI DILIP KUMAR ROY RANGE-49, KOLKATA. KOLKATA [PAN : ADKPR 8050 Q] ,- / FOR THE ASSESSEE : SHRI A. K. DUTTA /0,- / FOR THE DEPARTMENT : SHRI A. K. PRAMANIK, SR. D.R. $1 /ORDER . . , , PER B. R. MITTAL, J. M. THESE ARE THE CROSS APPEALS ONE FILED BY ASSESSEE AND THE OTHER FILED BY REVENUE ARE PREFERRED AGAINST THE ORDER OF LD. CIT(A)-XXXII, KO LKATA DATED 27.11.2009 FOR ASSESSMENT YEAR 2006-07. 2. THE ASSESSEE HAS TAKEN FOLLOWING GROUND OF APPEA L :- (1) THE ASSESSEE SOLD NATURALLY GREEN TREES AS PART OF THE SALE PROCEEDS OF LAND FOR A SUM OF RS.2,00,000/- AND CLAIMED THE SAM E AS INCOME FROM CAPITAL GAIN. LATER ON, IN VIEW OF TWO JUDGMENTS OF MADRAS AND P & H HIGH COURT, IT WAS CLAIMED THAT THE PROCEEDS WERE N ON-TAXABLE INCOME. THE A.O. HELD IT TO BE BUSINESS INCOME AND THE CIT (A) HELD IT TO BE INCOME FROM THE OTHER SOURCES. [ ITA NO. 609 & 629/KOL/2010] 2 (2) THE ASSESSEE OPENED A FIXED DEPOSIT A/C. AND EARNED INTEREST INCOME OF RS.2,75,796/-. THE FIXED DEPOSIT AMOUNT INCLUDED A SUM OF RS.12,95,000/- BELONGING TO HIS RELATIVES AND THE A SSESSEE CLAIMED OUTGOING OF RS.64,750/- OUT OF INTEREST INCOME. ON THE GROUND THAT CONFIRMATION WAS NOT FILED BEFOR E DATE OF ASSESSMENT. THE A.O DISALLOWED THE CLAIM. THE LD. CIT(A) CONFIRMED THE ADDITION. 3. THE DEPARTMENT HAS TAKEN FOLLOWING GROUNDS OF AP PEAL :- (I) THE LD. CIT(A) ERRED IN NOT APPRECIATING THE FA CTS AND CIRCUMSTANCES OF THE CASE BECAUSE, THE CASE LAW CITED IN THE APPELLA TE ORDER DOES NOT RELATE TO THE SECTION 54EC, WHEREAS THE CLAIM OF THE ASSES SEE WAS MADE U/S. 54EC. MOREOVER, IT CANNOT BE DENIED THAT THE PLANT & MACHINERY ARE DEPRECIABLE ASSETS ALTHOUGH THE SAME WERE TAKEN OVE R BY THE ASSESSEE FROM PARTNERSHIP FIRM. THE LD. CIT(A) REMAINED SILE NT ON THIS POINT. 4. FIRST, WE SHALL TAKE UP APPEAL FILED BY ASSESSEE IN ITA NO. 609/KOL/2010. 5. IN RESPECT OF GROUND NO.1 OF APPEAL, THE RELEVAN T FACTS ARE THAT ASSESSEE SOLD LAND AND CLAIMED CAPITAL GAINS. THE ASSESSEE STATED THAT THE RE WERE TREES WHICH WERE SELF GROWN ON THE SAID LAND AND THESE WERE ALSO SOLD ALONGWITH LAND C OMPUTED ITS VALUE AT RS.2,00,000/-. THE ASSESSEE STATED THAT THERE WAS NO COST OF ACQUISITI ON AND AS SUCH, SOLD VALUE OF TREES IS CAPITAL GAIN TO ASSESSEE. THE ASSESSEE STATED THAT THE ENTI RE AMOUNT WAS INVESTED IN BONDS ISSUED BY NABARD AND, AS SUCH, ASSESSEE IS ENTITLED FOR EXEMP TION AS PER PROVISION OF SECTION 54EC OF THE ACT. ASSESSING OFFICER STATED THAT THE INCOME F ROM SALE OF TREES IS NOT CAPITAL GAIN AND ASSESSED THE SAME AS INCOME FROM BUSINESS. BEING AG GRIEVED, ASSESSEE FILED APPEAL BEFORE LD. CIT(A). 6. LD. CIT(A), AFTER CONSIDERING THE SUBMISSIONS OF ASSESSEE, HELD THAT ASSESSEE IS NOT IN THE BUSINESS OF CULTIVATION OR HORTICULTURE.. GROWI NG TREES AND SELLING THEM IS NOT HIS BUSINESS. THE TREES WERE NATURALLY GOWN TREES. HENCE, INCOME RECEIVED FROM NATURALLY GROWN TREES IS NOT TO BE ASSESSED UNDER THE HEAD PROFIT OR GAINS OF B USINESS OR PROFESSION OF ASSESSEE. LD. CIT(A) CONSIDERED THAT ASSESSEE WAS A PARTNER IN A FIRM M/S. D. K. ROY & BROS. AND THE [ ITA NO. 609 & 629/KOL/2010] 3 BUSINESS WAS TAKEN OVER BY ASSESSEE AS PROPRIETORSH IP ON ITS DISSOLUTION IN 2001. HE HAS HELD THAT SECTION 56 OF THE ACT LAYS DOWN THAT INCOME OF EVERY KIND AND THAT DOES NOT COME UNDER THE HEAD INCOME FROM SALARY, INCOME FROM PROFIT OR GAINS OF BUSINESS, CAPITAL GAIN, INCOME FROM PROPERTY AND WHICH IS NOT EXCLUDED FROM THE TO TAL INCOME UNDER THE ACT, SHALL BE CHARGEABLE TO INCOME-TAX ACT UNDER THE HEAD INCOME FROM OTHER SOURCES. LD. CIT(A) HAS HELD THAT THE SAID INCOME OF 2,00,000/- RECEIVED BY ASSESSEE ON SALE OF TREES IS TO BE ASSESSED UNDER THE HEAD INCOME FROM OTHER SOURCES. HENCE, ASSESSEE IS IN APPEAL BEFORE TRIBUNAL. 7. DURING THE COURSE OF HEARING, LD. AUTHORISED REP RESENTATIVE FOR THE ASSESSEE MADE HIS SUBMISSION ON THE LINES OF SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW. RELYING ON THE DECISION OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. AMRIK SINGH [2008] 299 ITR 14 (P&H) AND ALSO THE DECISION OF HONBLE A PEX COURT IN THE CASE OF CIT VS. SRINIVASA SETTY [1981] 128 ITR 294 (SC) SUBMITTED T HAT IF AN ASSESSEE ACQUIRES AN ASSET WITHOUT INCURRING ANY COST, CAPITAL GAIN COULD NOT BE TAXAB LE. HE FURTHER SUBMITTED THAT INCOME ARISING ON SALE OF TREES HAS TO BE ASSESSED UNDER THE HEAD CAPITAL GAIN. 8. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATI VE SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. HE SUBMITTED THAT WHEN ASSESSEE FILED RETURN, HE DID NOT SHOW IN THE COMPUTATION OF SALE OF TREES AND ONLY DISCLOSED SAL E OF LAND. ON ENQUIRY BY ASSESSING OFFICER, ASSESSEE STATED THAT THRE WAS SALE OF BUILDING, STA FF QUARTER, PLANT AND EQUIPMENT AND DISCLOSED SALE ALONGWITH LAND AND CLAIMED CAPITAL GAIN. HE SU BMITTED THAT INCOME ARISEN ON SALE OF TREES HAS RIGHT BEEN HELD AS INCOME FROM OTHER SOURCES BY LD. CIT(A). HE FURTHER SUBMITTED THAT THE CASES RELIED UPON BY LD. AUTHORISED REPRESENTAT IVE FOR THE ASSESSEE ARE NOT APPLICABLE TO THE CASE OF ASSESSEE AS THE CASE OF HONBLE PUNJAB & HARYANA HIGH COURT (SUPRA) STATES THAT IF AN ASSET ON WHICH NO DEPRECIATION IS CLAIMED AND TH ERE IS NO COST OF ACQUISITION OF ASSET, CAPITAL GAIN SHOULD NOT BE COMPUTED. HE FURTHER SUBMITTED T HAT THE CASE OF HONBLE APEX COURT IN THE CASE OF SRINIVASA SETTY (SUPRA) HAS NO RELEVANCE TO THE CASE OF ASSESSEE. 9. WE HAVE CAREFULLY CONSIDERED THE ORDERS OF THE A UTHORITIES BELOW. WE HAVE ALSO GONE THROUGH THE CASES CITED BY LD. AUTHORISED REPRESENT ATIVE FOR THE ASSESSEE (SUPRA). WE AGREE [ ITA NO. 609 & 629/KOL/2010] 4 WITH LD. DEPARTMENTAL REPRESENTATIVE THAT THE SALE PROCEEDS ON SALE OF TREES, WHICH WERE SELF GROWN ON THE LAND OF ASSESSEE, IS NOT CAPITAL ASSET . WE ARE OF THE CONSIDERED VIEW THAT LD. CIT(A) HAS RIGHTLY HELD THAT SALE PROCEEDS ON SALE OF TREES IS TO BE ASSESSED UNDER THE HEAD INCOME FROM OTHER SOURCES AND ASSESSING OFFICER W AS NOT JUSTIFIED TO HOLD THAT IT IS TO BE HELD UNDER THE HEAD BUSINESS INCOME BECAUSE ASSESSEE I S NOT IN THE BUSINESS OF GROWING TREES AND AND SELLING THEM. WE AGREE WITH LD. DEPARTMENTAL RE PRESENTATIVE THAT THE CASES RELIED BY LD. AUTHORISED REPRESENTATIVE (SUPRA) HAVE NO RELEVANCE TO THE FACTS OF THE CASE BEFORE US. WE HOLD THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE, TH ERE IS NO INFIRMITY IN THE ORDER LD. CIT(A) AND HENCE, GROUND NO.1 OF THE APPEAL TAKEN BY ASSESSEE IS REJECTED. 10. GROUND NO.2 OF THE APPEAL, ASSESSEE CLAIMED THA T INTEREST OF RS.40,000/- & RS.24,750/- WAS PAID TO SMT. BHARTI ROY AND SMT. SUTAPA SHARMA IN RESPECT OF ADVANCES RECEIVED FROM THEM. ASSESSING OFFICER DISALLOWED THE CLAIM ON THE GROUND THAT NO CONFIRMATION WAS FILED BY ASSESSEE. THE ASSESSEE FILED APPEAL BEFORE LD. CIT( A). 11. LD. CIT(A) CONFIRMED THE ACTION OF ASSESSING OF FICER ON THE GROUND THAT CONFIRMATION PROPOSED TO BE FILED BEFORE HIM WERE ADDITIONAL EVI DENCES AND NO REASONS HAVE BEEN GIVEN BY ASSESSEE WHY SUCH CONFIRMATIONS WERE NOT PRODUCED B EFORE ASSESSING OFFICER. HENCE, ASSESSEE IS IN FURTHER APPEAL BEFORE THE TRIBUNAL. 12. AT THE TIME OF HEARING, LD. AUTHORISED REPRESEN TATIVE FOR THE ASSESSEE FILED COPY OF REVISED COMPUTATION OF INCOME AND STATED THAT THE S AME WAS ALSO FILED BY ASSESSEE BEFORE THE AUTHORITIES BELOW SHOWING THAT ASSESSEE HAD RECEIVE D ADVANCES FROM SMT. BHARTI ROY AND SMT. SUTAPA SHARMA, DAUGHTER OF LATE S. ROY AND ASSESSEE PAID INTEREST TO THEM. LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT ASSE SSING OFFICER DID NOT ASK FOR CONFIRMATION AND HENCE, THE SAME WERE NOT FILED BEFORE HIM. HE S UBMITTED THAT THE SAID TWO CREDITORS ADVANCED AMOUNT TO ASSESSEE OUT OF SALE PROCEEDS OF LAND TO WHICH THEY WERE CO-OWNER. LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE SUBMITTE D THAT IF THE MATTER IS RESTORED TO ASSESSING OFFICER, ASSESSEE WILL FURNISH REQUISITE DETAILS WI TH DOCUMENTARY EVIDENCES OF RECEIPT OF ADVANCES FROM SMT. BHARTI ROY & SMT. SUTAPA SHARMA ON WHICH INTEREST WAS PAID BY ASSESSEE AS CLAIMED. [ ITA NO. 609 & 629/KOL/2010] 5 13. HOWEVER, LD. DEPARTMENTAL REPRESENTATIVE IN HIS SUBMISSION RELIED ON THE ORDERS OF THE AUTHORITIES BELOW. 14. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF LD. REPRESENTATIVES OF THE PARTIES AND THE ORDERS OF THE AUTHORITIES BELOW. WE HAVE ALSO G ONE THROUGH THE REVISED COMPUTATION OF INCOME ALONGWITH BALANCE SHEET AS ON 31.03.2006. ON PERUSAL OF COPY OF BALANCE SHEET, WE DO OBSERVE THAT ASSESSEE HAD SHOWN RECEIPT OF ADVANCES FROM B. ROY I.E. SMT. BHARTI ROY OF RS.8,00,000/- AND LATE S. ROY OF RS.9,90,000/-. WE OBSERVE THAT ASSESSEE FILED CONFIRMATION FROM SMT. BHARTI ROY AND SMT. SUTAPA SHARMA DAUGHTE R OF LATE S. ROY CONFIRMING RECEIPT OF INTEREST OF RS.40,000/- & RS.24,750/- FROM ASSESSEE IN RESPECT OF ADVANCES GIVEN BY THEM TO ASSESSEE. WE OBSERVE THAT LD. CIT(A) DID NOT CONSID ER THE SAID CONFIRMATIONS ON THE GROUND THAT ASSESSEE FAILED TO PRODUCE THE SAME BEFORE ASS ESSING OFFICER. CONSIDERING THE FACTS OF THE CASE AND IN THE INTEREST OF JUSTICE, WE CONSIDER IT PRUDENT AND AS PRAYED BY LD. AUTHORISED REPRESENTATIVE FOR THE ASSESSEE TO RESTORE THIS ISS UE TO THE FILE OF ASSESSING OFFICER WITH A DIRECTION THAT HE WILL DECIDE IT AFRESH AFTER GIVIN G DUE OPPORTUNITY OF HEARING TO ASSESSEE AND ALSO CONSIDERING SUCH EVIDENCES AS MAY BE PLACED BE FORE HIM. HENCE GROUND NO.2 OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 15. NOW, COMING TO APPEAL FILED BY DEPARTMENT BEING ITA NO.629/KOL/20010, W E OBSERVE THAT ASSESSEE SOLD LAND, PLANT AND MACHINERY, BUILD ING AND STAFF QUARTERS AND OTHER PLANT AND EQUIPMENTS, THE DETAILS OF WHICH ARE GIVEN AT PAGES 2 & 3 OF THE ORDER OF LD. CIT(A). THE ASSESSEE CLAIMED EXEMPTION U/S. 54EC OF INCOME TAX ACT ON ACCOUNT OF INVESTMENT MADE IN THE BONDS ISSUED BY NABARD. WE OBSERVE THAT ASSESSI NG OFFICER STATED THAT THERE WAS CAPITAL GAIN ON SALE OF LAND OF RS.1,74,440/- AND IT QUALIF IES FOR EXEMPTION U/S. 54EC OF THE ACT ON ACCOUNT OF INVESTMENT MADE BY ASSESSEE IN THE BOND S ISSUED BY NABARD. HOWEVER, IN RESPECT OF BALANCE CAPITAL GAIN ARISING ON SALE OF PLANT AND MACHINERY, BUILDING AND STAFF QUARTERS AND OTHER PLANT & MACHINERY, ASSESSING OFF ICER OBSERVED THAT ALL THOSE WERE DEPRECIABLE ASSETS AND THEREFORE, CAPITAL GAIN ARIS ING ON SALE OF THE SAME WAS TO BE ASSESSED AS SHORT TERM CAPITAL GAIN AS PER PROVISIONS OF SECTIO N 50 OF THE ACT. ASSESSING OFFICER STATED THAT BENEFIT OF SECTION 54EC OF THE ACT IS AVAILABLE ONL Y IN RESPECT OF LONG TERM CAPITAL GAIN, BENEFIT [ ITA NO. 609 & 629/KOL/2010] 6 OF SECTION 54EC OF THE ACT IS NOT AVAILABLE WITH AS SESSEE IN RESPECT OF CAPITAL GAIN ON SUCH ASSET I.E. PLANT AND MACHINERY, BUILDING & STAFF QUARTERS AND OTHER PLANT AND MACHINERY. BEING AGGRIEVED, ASSESSEE FILED APPEAL BEFORE LD. CIT(A). 16. ON BEHALF OF ASSESSEE, IT WAS CONTENDED THAT AS SESSEE HAD NEVER ENJOYED OR CLAIMED DEPRECIATION IN RESPECT OF ANY OF THE ASSETS SOLD B Y HIM. THEREFORE, PROVISIONS OF SECTION 50 OF THE ACT ARE NOT ATTRACTED. LD. CIT(A) ACCEPTED CONT ENTION OF ASSESSEE AND HELD THAT ASSESSEE HAD RIGHTLY CLAIMED CAPITAL GAIN ON SALE OF ASSETS VIZ. PLANT AND MACHINERY, BUILDING & STAFF QUARTERS AND OTHER PLANT AND MACHINERY AS LONG TERM CAPITAL GAIN. LD. CIT(A) HAS FURTHER HELD THAT ASSESSEE HAS INVESTED THE SAID CAPITAL GAIN IN BOND S ISSUED BY NABARD AND THEREFORE, BENEFIT OF PROVISIONS OF SECTION 54EC OF THE ACT IS TO BE A LLOWED TO ASSESSEE. HENCE, DEPARTMENT IS IN FURTHER APPEAL BEFORE TRIBUNAL. 17. WE HAVE CAREFULLY CONSIDERED THE ORDERS OF ASSE SSING OFFICER AS WELL AS LD. CIT(A) AND THE CONTENTION OF LD. REPRESENTATIVES OF BOTH THE P ARTIES. 18. WE OBSERVE THAT ASSESSEES STAND IS THAT ASSESS EE DID NOT ENJOY ANY DEPRECIATION IN RESPECT OF PLANT AND MACHINERY, BUILDING & STAFF QU ARTERS AND OTHER PLANT AND MACHINERY (ALL TAKEN OVER FROM PARTNERSHIP FIRM) AND HENCE, SECTIO N 50 HAS NO APPLICATION. ON THE OTHER HAND, ASSESSING OFFICER REJECTED THE CONTENTION OF ASSESS EE STATING THAT ASSESSEE IS NOT ENTITLED FOR EXEMPTION U/S. 54EC OF THE ACT FOR IN VESTMENT IN N ABARD AGAINST CAPITAL GAIN ARISEN FROM SALE OF PLANT AND MACHINERY, BUILDING & STAFF QUART ERS AND OTHER PLANT AND MACHINERY AS THE CASES STATED BY ASSESSEE DID NOT RELATE TO SECTION 54EC OF THE ACT AND ALSO SECTION 54EC WAS INTRODUCED WITH EFFECT FROM ASSESSMENT YEAR 2004-05 AND THE JUDGMENTS RELIED UPON BY ASSESSEE ARE IN RESPECT OF PERIOD PRIOR TO INTRODUC TION OF SECTION 54EC. IT IS RELEVANT TO STATE THAT CASES RELIED UPON BY ASSESSEE BEFORE ASSESSING OFFI CER ARE MENTIONED AT PAGE 6 OF ASSESSMENT ORDER WHEREIN THE ISSUE DECIDE WAS THAT U/S. 50 WAS NOT APPLICABLE AS DEPRECIATION HAD NOT BEEN CLAIMED ON THOSE ASSETS. WE OBSERVE THAT LD. CIT(A) HAS REVERSED THE FINDING OF ASSESSING OFFICER BY ACCEPTING THE CONTENTION OF ASSESSEE THA T SECTION 50 HAS NO APPLICATION, IF NO DEPRECIATION HAS BEEN ALLOWED UNDER THE ACT IN RESP ECT ASSETS SOLD BY ASSESSEE AND PLACED RELIANCE ON THE DECISION OF HONBLE MADRAS HIGH COU RT IN THE CASE OF KALI ACRATED WATER WORKS VS. CIT [2000] 242 ITR 79 (MAD.) [ ITA NO. 609 & 629/KOL/2010] 7 19. WE OBSERVE THAT AUTHORITIES BELOW HAVE NOT CONS IDERED THE ISSUE IN RIGHT PERSPECTIVE AND AS PER PROVISIONS OF THE ACT AS APPLICABLE TO ASSES SMENT YEAR UNDER CONSIDERATION. 20. IT IS A FACT THAT PROVISIONS OF SECTION 50 IS A PPLICABLE IN RESPECT OF THOSE ASSETS WHICH FORM PART OF BLOCK ASSETS IN RESPECT OF WHICH DEPRE CIATION HAS BEEN ALLOWED UNDER THE ACT AND THE EXCESS OF SALE PROCEEDS, OVER AND ABOVE, WRITTE N DOWN VALUE SHALL BE DEEMED TO BE CAPITAL GAIN ARISING OUT OF SHORT TERM CAPITAL ASSETS. IT I S ALSO A FACT THAT PROVISIONS OF SECTION 54EC OF THE ACT IS NOT APPLICABLE IN RESPECT OF CAPITAL GAI NS ARISING FROM SHORT TERM CAPITAL GAIN. IN OTHER WORDS, BENEFIT OF SECTION 54EC OF THE ACT IS ALLOWE D ONLY WHEN THE CAPITAL GAIN IS ARISING FROM THE TRANSFER OF LONG TERMS CAPITAL ASSET AND THAT C APITAL GAIN IS INVESTED IN CERTAIN BONDS. WE OBSERVE THAT THE CONTENTION OF THE ASSESSEE IS THAT ASSESSEE HAS NOT CLAIMED DEPRECIATION ON THE ASSETS SOLD AND THEREFORE, PROVISIONS OF SECTION 50 WILL NOT BE APPLICABLE. WE ARE OF THE CONSIDERED VIEW THAT THE SAID CONTENTION OF ASSESSE E HAS MERITS PRIOR TO ASSESSMENT YEAR 2001- 02. BY THE FINANCE ACT 2001, EXPLANATION 5 TO SECTI ON 32(1) HAS BEEN INSERTED WITH EFFECT FROM 01.04.2002, WHICH PROVIDES THAT PROVISIONS OF SUB-S ECTION (1) SHALL APPLY, WHE.THER OR NOT ASSESSEE HAS CLAIMED DEDUCTION OF DEPRECIATION IN C OMPUTING HIS TOTAL INCOME. IN OTHER WORDS, WITH EFFECT FROM ASSESSMENT YEAR 2002-03, IT WILL B E DEEMED THAT DEPRECIATION HAS BEEN ALLOWED IN RESPECT OF ASSETS FORMING PART OF THE BLOCK ASSE TS IRRESPECTIVE OF THE FACT THAT ASSESSEE HAS CLAIMED DEPRECIATION OR NOT. THEREFORE, WE ARE OF T HE CONSIDERED VIEW THAT PROVISIONS OF SECTION 50 IS APPLICABLE IN RESPECT OF ASSETS SOLD I.E. PL ANT AND MACHINERY, BUILDING & STAFF QUARTERS AND OTHER PLANT AND MACHINERY BY ASSESSEE IN ASSESSMENT YEAR CONSIDERATION. 21. SINCE THE ISSUE HAS NOT BEEN CONSIDERED BY THE AUTHORITIES BELOW IN THE LIGHT OF EXPLANATION 5, INSERTED BY FINANCE ACT, 2001, WITH EFFECT FROM 01.04.2002, WE ARE OF THE CONSIDERED VIEW THAT THIS ISSUE BE RESTORED TO THE FILE OF ASSESSING OFFICER WITH A DIRECTION TO EXAMINE THE ISSUE IN THE LIGHT OF OUR OBSERVATIONS AS MENTIONED HEREINABOVE AND DECIDE CAPITAL GAIN AROSE TO ASSESSEE AND ALSO CONSIDER AS TO WHET HER ASSESSEE IS ENTITLED FOR BENEFIT OF SECTION 54EC OF THE ACT OR NOT AFTER GIVING DUE OPPORTUNITY OF HEARING TO ASSESSEE AND AFTER CONSIDERING SUCH EVIDENCES AS MAY BE FILED BEFORE HIM. HENCE, W E SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW BY ALLOWING GROUND OF APPEAL TAKEN BY THE DEP ARTMENT FOR STATISTICAL PURPOSES BY [ ITA NO. 609 & 629/KOL/2010] 8 RESTORING THE ISSUE TO THE FILE OF ASSESSING OFFICE R FOR HIS CONSIDERATION. 22. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED IN PART FOR STATISTICAL PURPOSES AND WHEREAS APPEAL OF THE DEPARTMENT IS ALLOWED FOR STATISTICAL PURPOSES. $1 2 3' 4 56 ORDER PRONOUNCED IN THE COURT ON 13. 04. 2011. SD/- SD/- [ . .. .'# '#'# '#. .. . , ,, , $% ] [ . . , ] [ C. D. RAO ] [ B. R. MITTAL ] ACCOUNTANT MEMBER JUDICIAL MEMBER (#%) DATED : 13TH APRIL, 2011. $1 7 /8 9$8)/ COPY OF THE ORDER FORWARDED TO: 1. ,- /APPELLANT- SHRI DILIP KUMAR ROY, 23, RAFI AHMED KIDWAI ROAD, KOLKATA-700055. 2 /0,- / RESPONDENT : DY. COMMISSIONER OF INCOME TAX, CIRC LE-49, 169, A.J.C. BOSE ROAD, KOLKA TA. 3. 1'/ THE CIT, 4. 1' ()/ THE CIT(A), KOLKATA. 5. ?4 /'/ DR, KOLKATA BENCHES, KOLKATA [08 // TRUE COPY] $1'3/ BY ORDER, !A /DEPUTY/ASSTT REGISTRAR [ KKC BC 'DA E /SR.PS]